Tuesday, 25 November 2008

US Fed announces $800bn stimulus

To tell the truth, I am getting a little bored by these stimulus packages. They are now appearing at the rate of one day.

Today it was the Fed's turn to produce a big number and splash it about town. This time, consumers will be the lucky beneficiaries. The Fed will use $200 billion to buy up credit card debt. The remaining $600 billion will evaporate in a grey haze of toxic mortgage debt.

Unfortunately, the full implications of these kind of government initiatives is rarely fully understood. In this particular case, the US government is going to use taxpayers money to help people use their credit cards. Remember, this is a country that doesn't have universal healthcare or an adequate unemployment benefit.

It is all about priorities, the sick can go to hell. The US needs spenders, not shirkers.

It all goes to prove one thing. Being a UK taxpayer might be bad, being a US taxpayer is definitely worse.

3 comments:

£800 billion 'stimulus' can't compensate for the rate at which trillions of credit were created over the last ten years, but no longer. It will not even reduce terminal velocity as the US economy hits rock bottom.